The Republican-controlled US Congress yesterday sought to push forward with President Donald Trump’s sweeping tax-cut bill, as one of his top economic officials dismissed Moody’s decision to strip the federal government of its top-tier credit rating.
A handful of hardline Republicans blocked the bill from clearing an important procedural hurdle on Friday, saying it did not cut spending sharply enough, with the House of Representatives set to try again in a rare Sunday-night committee session.
Non-partisan analysts say the bill, which would extend the 2017 tax cuts that were Trump’s signature first-term legislative win, would add $3 trillion to $5trn to the nation’s $36.2trn in debt over the next decade. Moody’s cited the rising debt, which it said was on track to reach 134 per cent of GDP by 2035, for its downgrade decision.
Treasury Secretary Scott Bessent dismissed the cut’s significance in a pair of television interviews yesterday, saying the bill would spur economic growth that would outpace what the nation owed.
“I don’t put much credence in the Moody’s” downgrade, Bessent told CNN’s State of the Union programme, echoing White House criticism.
Economic experts, meanwhile, warn the downgrade from the last of the three major credit agencies was a clear sign that the US has too much debt and should prompt legislators to either increase revenue or spend less.
Congressional Republicans in 2017 also argued that the tax cuts would pay for themselves by stimulating economic growth. But the non-partisan Congressional Budget Office estimates the changes increased the federal deficit by just under $1.9trn over a decade, even when including positive economic effects.
House of Representatives Speaker Mike Johnson yesterday said the chamber is still “on track” to pass the bill, which the House Budget Committee plans to vote on in a hearing.
“We’ve had lots of conversations. We’ll have more today,” Johnson said on Fox News Sunday with Shannon Bream when asked about hard-line Republicans, including Representatives Chip Roy of Texas and Ralph Norman of South Carolina, demanding more spending cuts.
Trump’s Republicans hold a 220-213 majority in the House and are divided over how deeply to slash spending to offset the cost of the tax cuts.
Hardliners want cuts to the Medicaid health insurance programme, a move that moderates and some Republican senators have pushed back against, saying it would hurt the very voters who elected Trump in November, and whose support they will need in 2026, when control of Congress is again up for grabs.
The bill’s cuts would kick 8.6 million people off Medicaid, the joint federal-state programme for low-income Americans. It also aims to eliminate taxes on tips and some overtime income – both Trump campaign promises – while also boosting defence spending and providing more funds for Trump’s border crackdown.
&uuid=(email))